While perennial pessimist Nouriel Roubini has been prescient in predicting recent economic woes, investors sticking to his forecasts have suffered dearly since March.
That’s because he’s been warning about continued problems in the economy while stock prices have soared.
The New York University professor has been arguing for weeks that the economy is in danger of suffering a double-dip recession. And he hasn’t yet recommended that investors plunge into stocks, Bloomberg notes.
Yet the Standard & Poor’s 500 Index has soared 53 percent from its March low.
When the rally began, Roubini called it a “dead-cat bounce,” and in May he said the ascent may “fizzle,” Bloomberg reports.
On March 9, Roubini said the S&P 500 was headed down to 600. Instead it has jumped 71 percent to 1,027 as of Wednesday morning.
“We’re looking at a bull cycle in phase one,” investment guru Laszlo Birinyi told Bloomberg.
“No one wants to come out and say, ‘This is a bull market.’ Everyone’s just dancing around the term.”
Birinyi says Roubini may have missed the upward move because he concentrates on the economy rather than stocks.
Roubini certainly isn’t the only bear.
Market sage Robert Prechter told Yahoo! News that recent stock gains represent a bear market rally and that the next wave will be down.
“I think we’ll definitely break the March 2009 lows, and I think the bear market will extend well into the next decade,” he says.
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